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New Council Immediately Voids Aces Deal, Made Same Day

In what was one of the most stunning twists in recent city council history, the Reno Aces' future now hangs in the air.

It began with the old city council wrapping up old business, which included a Waste Management Franchise agreement, a sales tax subsidy for Summit Sierra, and the SK Baseball Refinancing Deal. As usual, discussion of the SK Baseball deal turned ugly, pitting Jessica Ralston, Dwight Dortch and Sharon Zadra against Dan Gustin, the Mayor, Dave Aiazzi and Pierre Hascheff, who were all for the deal.

In a surprising genius move, Dortch and Zadra, citing Roberts' Rules of Order which states if you vote against the prevailing vote for a certain item, you cannot reconsider that item at a later date, both Dortch and Zadra voted FOR the baseball deal, even though they were adamantly against it, with plans to address it with the new council.

Dortch laid out a plan, predicting all of the new council members were against the baseball deal based on interviews with them during the election cycle. His plan, and Zadra's, was to bring the issue up again with the new council in the hopes the new city council would see the deal as too risky for the city's credit rating. They didn't waste any time, as it was one of the first items the new city council addressed.

So the deal passed, the Mayor had the papers right in front of him to sign, and after that, the new city council was sworn in.

Then, in one of the first items the new city council addressed, the contract was rescinded by the new city council, citing concerns to the City's credit rating if payments could not be made.

Poor bob Cashell was suddenly put in the minority vote as every single council member but him voted to put the brakes on the new Reno Aces deal. This isn't your ole' city council anymore.

Hillary Schieve, who I have already nicknamed The Voice of Reason, mentioned the deal should be put to the people for a vote.

City Attorney John Shipman gave some reason for concern....mainly Vadnais Heights, Minn., where the city council there agreed to stop making payments on its sports stadium which led to two major credit rating agencies downgrading the city’s formerly strong general obligation credit rating to junk status in September. If our city council commits its general funds to pay off a new bond payment, and then defaults on those, the same thing could happen. We also don't want a repeat of what happened to Schaumburg, IL, where attendance never really did recover after the Shaumburg Flyers were evicted after not paying rent, utilities, and other bills at the stadium. They have a new team, the Boomers, but fans were dealt a pretty hard blow. It's questionable if the Aces left Reno if we could secure a different team, and if that team would be as popular.

So now, the deal, and the future of the Reno Aces, hangs in the air. News 4 at Noon mentioned there are some lingering legal questions as to whether the new city council even had the right to do what they did.

Rescinding the deal doesn't mean the new council doesn't want to help the Reno Aces. Several of the new council members said this gives them the opportunity to step back and re-examine the deal, and what the city might be capable of doing.

I hope a new deal can be passed that doesn't put the city at quite so much risk...because I definitely don't want to see the Reno Aces leave, or a perpetually empty stadium in east downtown. Let's not forget there are TONS of businesses in town right now not meeting projected revenues, and Herb Simon IS in a position to solve all of this simply by writing a check. Let's face it, he's one of the richest men in the country.

Basin Street Properties keeps mentioning at every council meeting they are on the verge of securing $25,000,000 in financing to finally build the proposed Marriott hotel in the vacant space next to the Jones Vargus Tower, across the street from the Ballpark. Per their testimony to city council, the Aces leaving would devastate that deal. That would definitely not be good. The Reno Aces have had a substantial economic impact for the city, and they are Triple AAA Champions, which does promote the Reno brand. And there's no doubt the Reno Aces have brought a family atmosphere downtown. Plus, the stadium employs both directly and indirectly, hundreds of employees.

While this RGJ Editorial mentions the "actual" obligation from the city out of the general fund for the annual $1 million payment would only be $150,000, because $100,000 would come from the RDA and the remaining $750,000 would have gone to pay off a $10 million fire station loan, there is still a big difference in paying off a $10 million fire station loan, and paying the Reno Aces $30,000,000 over a 30 year period, and eventually in the future, there comes a point where the City would have successfully paid off the $10 million loan, yet instead must continue paying $750,000-$1 million a year for a much longer period (30 years). The fact remains this city was thrown into a recession, perhaps one of the worst in the country, and there's a REASON why the city hasn't been able to make its payments to the Aces.

One thing is for certain: SK Baseball may have to approach this deal in a very different way, now that we have a city council with zero ties to any of the previous deals made by the old guarde, and zero emotional ties to the development of the ballpark itself.

For me personally, I love the Reno Aces, and I love the atmosphere in east downtown the stadium provides, and my nieces love to go to Aces games. So I would like to find out a way to help them stay.

 

Comments:

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Posted by: Alan Cunningham - 11/15/2012 10:56:47 AM
One of the main problems is the "stadium lies empty" there are so many things it could be used for but the management constantly refuse to allow other uses of the facility

Posted by: Renorose - 11/15/2012 11:11:44 AM
As a charter season ticket holder and avid baseball fan, I would be devastated if an agreement cannot be reached. Reno fought for this and the entire downtown area has benefited from having the Reno Aces here. Let's hope SK Baseball and the City Council can re-address this issue in a manner that continues to service all concerned.

Posted by: tahoedrew - 11/15/2012 11:36:36 AM
I agree with Alan about the stadium's use for other purposes, especially in the 5-month off-season! Ok, so maybe use of the field should be restricted (or VERY expensive to cover potential repairs if damaged), but what about all the suites and the rest of the facility? There could be some unique opportunities there. Plus, so WHAT if the field is damaged in the fall, after the season concludes. There's still plenty of time for repairs and that's what a free-market is for; appropriately pricing and insuring the use of the field can recover any potential needed repairs. Who has authority over that facility for non-baseball use, is it SK Baseball? If so, they've created a bit of their own issue. Before the stadium was even built city residents were sold on it as the potential to host concerts, events and even high school championships. I've not seen the facilities used for anything BUT SK Baseball activities.

Posted by: Renoite - 11/15/2012 4:41:38 PM
Right now, the ballpark gets sales tax revenue from the business next it, hasn't paid it property tax for over two years, and now wants another handout? Why is it when government gives corporate handouts to businesses, the business never can figure out a way to make money without the welfare payment. Giants make a ton of money and own their park.

Posted by: doofus - 11/15/2012 7:38:44 PM
Reno RDA was supposed to be able to fund their contributions to the original stadium deal the increase in property taxes the stadium would generate in the area. In fact, property taxes (generally the casinos) have been reduced by up to 90%. It will take 30 YEARS best case for property tax revenue in the district to reach their levels of when the stadium deal was penned. Why no other events? Right now, the Aces rent the stadium all year. It is their decision not to hold other events, even thought they are approved in the lease agreement. The new approved/rejected deal had the Aces only leasing the stadium for the season, with Reno controlling off season event scheduling. Nice, until you realize that the partial year lease would would reduce property tax revenue from the stadium by 50%. I don't think the Aces are going anywhere soon, and the new council was right to temporarily put the kibosh on the deal. I'm sure there will be several new deals proposed before an agreement is finally reached. And it will be reached. Best City Council meeting ever!

Posted by: Blake Crosby - 11/16/2012 1:12:37 PM
If you love the Reno Aces so much, I suggest you finance them. Fans should be able to buy stock in the company and get dividends if and when they become profitable. Government subsidy of private enterprises IS THE REASON WE'RE IN THIS MESS!!!!! Government bailout of failing subsidized private enterprise is the reason we'll STAY IN THIS MESS!!!!! America is failing because A. we're redistributing wealth from all citizens to a few private businesses and B. bailing them out when they inevitably fail. Are we really that stupid? If the Reno Aces need a government bailout, they're a business failure that needs to fail and resources freed up will stimulate other sectors of the economy. For a decade before the Recession, we KNEW TOURISM AND GAMING WAS IN DECLINE!!!! And yet like a gambling addict, we threw good money after bad money. Look at the success of Midtown and how much of the economy they've stimulated, and where are their government handouts and convention centers and baseball parks and Scheels and what not??? Wait a sec, you mean businesses can thrive and stimulate the economy without government handouts??? You're insane! A free market will never work! I LOVE THE NEW COUNCIL and Cashell, the dinosaur of old gambling Reno, is the new Jeff Griffin. Time to step aside and let Reno thrive. Quit throwing good money after bad. The teachers union is now proposing a business tax in Nevada. Pretty soon, businesses will not relocate here and we will self-destruct.

Posted by: Tom - 11/16/2012 9:47:40 PM
Let me put it like this: the owners of the Aces who got the stadium built (good for them) would suggest that every citizen of Washoe county pay part of their taxes to pay for the stadium (OK so far) and then charge them every time they enter the stadium and the Aces get to keep that money (what?).

 

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